Explained: How to read the Apple vs Epic Games decision

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The verdict in high-profile Apple vs Epic Games case was not what both parties wanted. Epic Games had claimed that Apple’s App Store was a monopoly and charged exorbitant fees on games like its Fortnite. But the federal court ruling in Oakland, Calif., While kind of a compromise, will set the tone for how big tech will work in the years to come in many ways.

Highlights of the Apple vs Epic Games decision, and what it means for iPhone and iPad users:

Apple is not “monopolistic”

Epic Games had repeatedly tried to prove that Apple’s App Store was a monopoly, forcing developers to follow its rules in order to reach billions of iOS devices. But Judge Yvonne Gonzalez Rogers ruled in favor of Apple, saying the company was not a monopoly and its success was not “illegal.”

“While the Court finds that Apple enjoys a sizable market share of over 55% and extraordinarily high profit margins, these factors alone do not indicate antitrust behavior. Success is not illegal, ”Justice Rogers said.

For Apple, this is a big victory because the company claimed from the start that the structure of the App Store was legal.

“The final trial record did not include evidence of other critical factors, such as barriers to entry and decreased production or decreased innovation in the relevant market,” the judge wrote. “The Court does not find that this is impossible; only that Epic Games has failed to demonstrate that Apple is an illegal monopolist.

Epic won “partially” but lost the case

Judge Rogers released an injection that Apple must let developers show customers different ways to pay outside of the App Store. Simply put, the App Store should allow third party payments.

Apple cannot prohibit developers from “including in their applications and their metadata buttons, external links or other calls to action that direct customers to purchasing mechanisms.” The order is expected to take effect in 90 days. Apple had argued that all apps should use Apple’s own in-app payment options. The company typically takes between 15% and 30% off on app purchases.

“This measured remedy will increase competition, increase transparency, increase consumer choice and information while preserving Apple’s iOS ecosystem, which has pro-competitive justifications,” said Rogers.

While it looks like Apple’s lucrative App Store business has been hit hard by the court ruling, it doesn’t have much of an impact on the Cupertino company on the surface. Of course, this is a win for the developers but not for Epic in particular.

Apple will continue to follow the practices of the App Store and need not make any significant changes, which Epic had supported from the start. In fact, the Apple-Epic Games lawsuit was about Cupertino’s rigid control over the App Store. This was the main reason Epic sued Apple.

The move, in a way, eases some of the restrictions Apple has placed on its developers. The company recently allowed developers of “player” apps like Netflix, Spotify, and Kindle to connect to the web to register. That way, they could bypass Apple’s 30 percent cut. To be clear, the concession does not cover apps offering in-app purchases or subscriptions, such as Epic Games’ Fortnite or the Tinder app.

The impact of the ruling on iPhone and iPad users

If you are an iPhone or iPad user and want to subscribe to a streaming app, you may have the option to pay through the developer’s own systems. You might see a new button in popular apps that lets you buy things (eg Roblox) through its own payment system or you can subscribe or make payment on a web browser. Does this mean that purchasing items through the app is getting cheaper? We do not know yet. Since developers are no longer forced to use Apple’s own payment system, they could either lower their prices or keep the savings with them.

Epic Games “overwhelmed by antitrust claims”

The result of the verdict is that Apple’s 30% commission on its own payment processor is not going anywhere. In fact, Judge Rogers said the developer of Fortnite Epic Games “crossed the line” in its antitrust lawsuit against Apple. From the start, the argument was whether to call Fortnite a real game. The judge found a fault in Epic’s way of defining the commodity market because there is no legal definition of a game. She said the argument was never about how video games are distributed, but on the way video game payments are processed. Epic Games’ only victory comes in the form of the ruling which makes it clear that Apple cannot stop app developers from directing users to third-party payment options. Apple actually won on nine of the 10 counts, except this one.

The ruling orders Epic to compensate Apple for the App Store cut that the company has avoided paying for months because it broke its contract with Apple. The Fortnite maker now owes Apple $ 3.6 million for violating App Store policies last year. Last year, Epic introduced its own payment method within Fortnite, breaking App Store rules and this led to Apple banning Fortnite from the App Store. It was the start of the legal battle between Apple and Epic Games.

Epic Games chief Tim Sweeney said the move was “not a victory for developers or consumers” and said the company “was fighting for fair competition between in-app payment methods. and app stores for a billion consumers “. As expected, the leading developer has filed a notice of appeal in the case against Apple regarding the App Store policy.

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